In the 1990s networks were fairly simple systems. Since there wasn't a lot of dedicated staff in the IT department, the teams typically didn't do anything for general maintenance if their machines were malfunctioning or slowing down--only if they stopped working. Once they broke, the technology team would fix them, which became known as the break/fix method.

This mentality cost companies a lot of lost revenue thanks to downtime and loss of data and productivity.

After a while some of the biggest Fortune 500 companies recognized the negative impact this mentality was having on their business. They began to work with IT service providers to proactively diagnose and correct problems before they caused an issue for the company. This early version of IT outsourced service management used complex software to analyze the data, which was extremely cost prohibitive and wasn't accessible for most companies.
Managed Service models have evolved over time, and the seasoned providers have perfected their delivery. It is very effective for businesses that:
Other symptoms of a need for an MS include following:

“We didn’t achieve everything we wanted last year due to a lack of Service and Support.”
“We had too many service outages and downtime.”
“We overspent our budget on tweaks to our business applications that eroded its performance.”
“We lost data due to lack of ability with the solution.”
From my experience working with small and large client companies alike, I often suggest how a managed service can help address these challenges. In my career, I have worked with many clients that are utilizing managed services in a variety of ways. Most recently, I provided a managed service to a large energy company which found the service to be seamless and significantly improved the satisfaction of end users and IT support staff, globally.

Rely on their IT infrastructure to properly support their daily business processes
Do not have sufficiently trained staff or time to formally deal with proper maintenance, updates, and repairs
Want to pay one monthly, flat fee for services to provide a high level of service quality to the business
For most business services, IT underpins the business engine. From software to hardware and the skills required to keep the service running, a company could invest significant capital in building and maintaining the in-house support staff.

More info: network architect